Alibaba And SoftBank Forming A Joint Venture, To Launch Cloud-Computing Services in Japan.

Chinese ecommerce giant Alibaba and Japanese telecommunications provider SoftBank have formed a joint-venture cloud services company called SB Cloud to bring Alibaba Cloud’s technology and solutions to Japanese businesses.

SB Cloud plans to open a Japanese data center offering data storage and processing services, enterprise-level middleware as well as cloud security services, according to the companies.

Alibaba Group holds a 40 percent stake in the joint venture, while SoftBank Corp., a SoftBank Group subsidiary that operates mobile and fixed-line communications and Internet connection services in Japan, has a 60 percent stake. SoftBank Group was an early investor in Alibaba Group and remains a major shareholder. Alibaba and SoftBank in 2008 launched another joint venture, Alibaba.com Japan Co., a Japanese-language online wholesale marketplace.

SB Cloud will enable Alibaba Cloud to further expand its cloud-computing service platform by leveraging SoftBank’s extensive business customer base in Japan, where the demand for public cloud-computing services is growing rapidly, the companies said.

“I believe the JV team can develop the most advanced cloud platform for Japanese customers, as well as for multinational customers who want to use the resources we have available in Japan,” said SoftBank Executive Vice President Eric Gan, who is also CEO of SB Cloud, in a statement.

Japan represents the latest international foothold for Alibaba Cloud, which has data centers in mainland China, Hong Kong, Singapore and the U.S., and is planning to add nodes in regions including the Middle East and Europe.

Alibaba last week reported that Alibaba Cloud’s revenues grew 175 percent to more than RMB 1 billion ($154 million) in the quarter ended March 31. While cloud computing currently contributes just 4 percent to Alibaba’s overall revenue, the division could account for more than $1 billion of sales by 2018, according to an analyst report cited in a recent Bloomberg story.